Harry Haslam, Jr. was born and reared in Savannah and knows well what Memorial University Medical Center has meant to his hometown.

“I believe that without Memorial we wouldn’t have the quality of life we enjoy here,” said the new board chair of Memorial Health, the parent corporation for the medical center.

Part of that, and a major reason for his joining the 18–member board three years ago, is what the medical provider gives back to the community, said Haslam, senior partner at Hancock, Askew & Co., certified public accountants.

“The kids you see playing on Savannah’s playgrounds, they ought to have the same health care that I do” — regardless of what their parents do or don’t do, said Haslam.

The medical center, which serves as the region’s safety net hospital, provides about $30 million in indigent and charity care annually — the largest such provider in the region and behind only Grady Memorial Hospital in Atlanta statewide.

Haslam, 62, knows he and his board are wading into a health care environment that is increasingly complex and facing ever-growing financial hurdles that must be overcome to maintain its mission and vision.

• $28 million in costs for clinical services for uninsured patients. Of that, $18 million will go for a 25 percent uninsured rate in the city of Savannah. The other $10 million is for patients outside Savannah.

• $15 million in changes caused by the Affordable Care Act, known broadly as Obamacare, especially cuts to safety net funding and provider reimbursements.

• $76 million for integrating new technology, including electronic health records.

And for the challenge of maintaining a competitive cost structure while supporting new programs, growth needs and team members.

In Chatham County, that includes sharing the landscape with St. Joseph’s/Candler, a medical group that includes two hospitals.

“There are two very good hospital systems in this town,” Haslam said. “That works to everybody’s advantage.”

Unsettling times

Memorial has gone through major financial challenges over much of the past decade, for much of that time spent fighting recurring red ink. That has brought into question the ability of management to maintain its identity in the health care sector.

Haslam said he remains confident the medical center’s image and vision will be unchanged.

Haslam’s predecessor, attorney and businessman J. Curtis Lewis III, who left the chair’s seat Wednesday after three years, came on in 2011 with a new interim president/CEO in Maggie Gill and recurring large financial deficits.

Gill, who became permanent president/CEO in April 2011, was the third head of the hospital in just more than three years.

Gill inherited a $27 million gross operating loss amid a string of five years when the system ended in the red.

Within a year, Gill and the board were able to report a $29.1 million turnaround and an operating income of $1.5 million and a system net income of $4.8 million.

Even then, she cautioned that the margins were slim and would need constant attention to preserve the turnabout.

“Our margins are dangerously thin,” Gill said at the time in a mantra she continues to maintain, calling them “still too thin for me to sleep at night.”

Audits for last year are not expected to be ready until April, but Gill said unaudited 2013 financials for Memorial Health System show net operating revenues of $541.9 million and net income, which includes operating income/losses and investment earnings, was $8.1 million.

It will mark the third consecutive year of positive financial results.

The board also includes Gill as a non-voting member and Jacqueline “Jackie” Rabinowitz, chairwoman of the Memorial Health Foundation trustees.

Leadership has brought the Chatham County Commission into the mix with a refinance of $183 million bonds in 2012 that freed funds for needed capital improvements.

That has allowed Gill and the board to launch more than $40 million in hospital upgrades and, in concert with North Carolina-based Novant Health, to build a free-standing children’s hospital on campus that will be called “The Children’s Hospital of Savannah, a Memorial-Novant Partnership.”

When completed in three years, the new hospital will serve the immediate 35-county region. Last year, the existing childen’s hospital served children from 120 Georgia and South Carolina counties.

“It helps fulfill our mission,” Haslam said of the Novant partnership, adding that his personal mission will be completion of the children’s hospital project.

The electronic records conversion project, which will cost about $70 million over five years, is one of his major challenges, Haslam said.

“I think we are going to see some very significant long-term benefits,” he said. (But) “We’re going to have to pay for it up front. It is a capital expenditure and will take a large portion of our capital budget”

Both Haslam and Lewis give Gill credit for the positive moves.

“I’m just very impressed with Maggie and the job she is doing,” Haslam said, adding that her “hard work, integrity and boundless energy” were traits she brought with her to the top office.

Vision, mission safe

Lewis, who took the chairmanship pledging “not to change the mission of the organization,” said Memorial’s goal still is to be a community and regional health care provider.

“I don’t think that will ever change,” he said. “That’s one thing that’s pretty much etched in stone and what it means to the community.”

But Lewis said the financial challenges facing health care providers and Memorial in particular are not going away.

“There are a lot of unknowns,” Lewis said. “We have to be prepared to meet the challenges, but it’s going to be difficult going down the road.”

The Harry Haslam, Jr. file

Name: Harry Haslam Jr.

Position: Board chair, Memorial Health

Age: 62 (DOB 11/17/1962)

Native: Savannah

Education: Benedictine Military School, 1969, Bachelor of business administration in accounting, University of Georgia, 1973

Current Civic: Board member of Memorial Health, Saint Benedict Education Foundation, and The 200 Club of the Coastal Empire. Member and past president of the Hibernian Society of Savannah.

Prior Civic: Board member, The Georgia Conservancy; BDO Seidman APAC, (BDO Alliance Partners Advisory Council, an international accounting firm with 150 US local and regional firms) Benedictine Military School and Home Builders Association of Savannah.

Personal: Wife, Kimi; five children and seven grandchildren, and communicant of St. Peter the Apostle Church.